It’s been another busy year for Choctaw Utilities. Through the hard work of our manager, office staff, and volunteers, we enjoyed a successful operation and are looking forward to 2024. Highlights from 2023 include: completing an engineering study of our plant operations and distribution system, installing several new hydrants, and starting a review of our rate structure.
Choctaw Utilities retained CT Consultants, a highly referred expert in water distribution systems and plant operations. CT gathered data on our system, including from the GIS (Geographical Information System – a digital mapping/asset management software program) project we completed last year, and constructed a Water GEMS (Global Environment Water System – a hydraulic modeling tool used to perform analysis on a water distribution network system) water model of our system. The results from the GEMS model yielded several recommendations to improve water freshness and plant operations:
- New plant settings which turn over the water inventory in the towers over 25% each cycle, instead of the previous 12-13%. This change has been effective since September – based upon taking zero calls on pressure changes, you didn’t even notice!
- Recommended three new locations to add flushing hydrants to address ongoing quality issues. Installed in late November.
- A unidirectional flushing (UDF) protocol. The UDF flush is planned for spring 2024. We expect the UDF flush to remove sedimentation that exists in all water distribution system mains. When we increase the gallons per minute – flow rate – produced by the plant during the dry summer months, we stir up the sediment that is normally undisturbed by lower flow rates we use the rest of the year. The sediment in the mains must be removed in order to implement the other GEMS operational recommendation: using higher flow rates as part of normal operations, not just high use periods, which will further improve water age and quality. More information will be forthcoming on the UDF flush – we have never performed a flush like this in the 60 years our system has been operational.
The complete engineering study can be viewed at www.choctawwater.com
As part of our transition last year from a For Profit to a Not For Profit company, we are required to operate at cost – neither at a profit, nor at a loss. The last time Choctaw Utilities raised rates was in July of 2018. Since 2018, Choctaw Utilities has:
- Successfully constructed a new $2.2 million dollar plant, during COVID, at 1% over budget
- Paid 3.5 years of the 20 year construction loan, which has a fixed interest rate of 1.875%
- Trained a new class 1 operator, Mike Casimir, who assumed responsibility from long-time operator Jim Moran
- Transitioned from a separate, dedicated CU staff, back to a contractual relationship with the CLPOA office, realizing synergies for both parties
- Transitioned from a For-Profit to a Not-For-Profit tax status
- Inflation since the last rate increase in 2018 is 21.5%[i] yet CU rates have remained unchanged
Rate Structure cont’d
In October 2021, the CU board of directors approved a 5 year plan. However, inflationary pressures have caused the board to reopen that 5 year plan to ensure our rate structure reflects reality. To that end, CU formed a rate structure committee at the September 2023 board meeting. The 5 year plan essentially looks at our operation through two lenses: Operations and Future Capital.
Things we budget for from an Operations standpoint include: treatment products such as hypochlorite and orthophosphates, electric, gas, sewer, contract obligations for staff, and small maintenance items.
Future Capital needs include what we need to sustain operations forever. Future Capital requirements from our 2021 plan are depicted in the spreadsheet below:
The CU rate structure committee is specifically studying Future Capital requirements. The spreadsheet above depicts the amount and timeframe we are saving towards. Expenses further out, for example the cost to eventually Replace Distribution Lines, may not reflect reality anymore, so we are studying this issue to ensure we are in compliance with our charter: to operate neither for profit nor at a loss. Expect more information to be forthcoming once the rate structure study is complete.
We look forward to continuing to serve the Choctaw Lake community in 2024 and into the future! Please check out our website: www.choctawwater.com for more information.
The Choctaw Utilities Inc. Board of Directors